Filing for Chapter 13 bankruptcy can be a positive action for your financial future. By taking this action, you will have a good chance of being able to gain control of your debts over the next few years, and you will also get relief from creditor action.
However, filing for Chapter 13 bankruptcy is not always a simple and easy road. It is a big commitment, and you may encounter some challenges when embarking on the process. The following are some common bankruptcy mistakes that you should do your best to avoid.
Not thinking about timing
Good timing is key when making any big decision. If you are faced with immediate creditor action such as wage garnishment or foreclosure, you should file as soon as possible. But if you see future debts on the horizon, you may want to wait so that you can also include them in your bankruptcy.
Not informing creditors of your bankruptcy
When you file for bankruptcy, you will benefit from an automatic stay. This means that all creditors and debt collectors will need to stop making contact with you. You may need to inform them of your bankruptcy filing to benefit from this.
Not avoiding further debt
It’s necessary to change your spending habits in addition to filing for bankruptcy if you want to see real change. This may require that you create a strict budget to avoid getting into further debt.
If you are struggling with debts that are making you feel stressed and overwhelmed, you should look into the several ways that you can file for bankruptcy.